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Texas AG files first 3 price gouging lawsuits

The Texas attorney general is suing three companies for price gouging in the wake of Hurricane Harvey, alleging the practice is unlawful.

The lawsuits accused the businesses of taking advantage of people who had been encouraged to leave their homes before the powerful Hurricane Harvey struck the Texas coast on August 25.

And in Robstown near Corpus Christi, the Best Western Plus Tropic Inn allegedly charged three times its normal room rate the weekend Hurricane Harvey hit. Perhaps more audacious was Bains Brothers, owners of two gas stations that allegedly charged $6.99 for a gallon of regular, while their own signs advertised prices between $3.00 and $4.00. The station is owned by Bains Brothers Petroleum, which owns several Texaco-branded gas stations in the Dallas-Fort Worth area.

Best Western has since ended its relationship with Robstown Enterprises, Paxton said.

The governor declared a state of emergency, making it illegal for companies to overcharge for necessities like hotels, food and gas.

In a statement, Paxton said it's "unconscionable that any business would take advantage of Texans at their most vulnerable - those who are displaced from their homes, have limited resources, and are in desperate need of fuel, shelter and the basic necessities of life".

The third business listed in the lawsuit, Encinal Fuel Shop, located outside Laredo, Texas, was reported to have charged $8.99 to $9.99 for a gallon of unleaded gas.

Assistant Attorney General Brad Carpenter told said investigators got many complaints but are going after cases they know are air-tight. If found guilty, he will have to pay a $20,000 penalty for each case of price gauging.

Paxton indicated that additional lawsuits are possible, saying his office has received 3,321 complaints of price gouging related to the unprecedented storm. If the customer defrauded is older than 65 years old, the penalty jumps to $250,000.